MSFT Dividend

MICROSOFT dividend

Although MSFT has a dividend of 0.46 with an ex-dividend date of Nov 14, you can sell covered calls on MICROSOFT to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Mon 4:16 PM ET):

MICROSOFT (MSFT)
Bid Ask Last Change Volume P/E Market Cap
107.60 107.74 107.60 -1.97 30.1M 51 814B

MSFT Dividend-Like Income Using Covered Calls

With MSFT at 107.60, here's a table showing how big the annual "dividend" (ie. total annual call premium received) would need to be to attain 3%, 5%, and 10% annual yields. Also shown is the equivalent number of cents/day necessary to achieve each yield:

Annual Yield Annual Premium Cents/Day
3% 3.23 0.9
5% 5.38 1.5
10% 10.76 2.9

So now we need to find out of the money covered calls that pay at least the prescribed cents/day amount of time premium. That will generate income and, because they are out of the money, leave room for some upside potential on the stock. Here are some examples:

3% Yield On MSFT Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Oct 19 114.00 0.06 5 1.2 6.26 (5.8%)
Oct 26 119.00 0.14 12 1.2 11.26 (10.5%)
5% Yield On MSFT Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Oct 19 113.00 0.11 5 2.2 5.26 (4.9%)
Oct 26 117.00 0.24 12 2.0 9.26 (8.6%)
10% Yield On MSFT Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Oct 19 112.00 0.20 5 4.0 4.26 (4.0%)
Oct 26 115.00 0.48 12 4.0 7.26 (6.7%)

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Top 10 Open Interest For Oct 19 Expiration     Top 5 High Yield
1.SPY dividend 6.MU dividend   1.CRON dividend
2.SPX dividend 7.FXI dividend   2.UVXY dividend
3.EEM dividend 8.BAC dividend   3.NIO dividend
4.QQQ dividend 9.AMD dividend   4.NFLX dividend
5.PBR dividend 10.XLF dividend   5.AMRN dividend

Want more examples? MSEX Dividend | MSG Dividend